Costs Orders By Panel.
Costs Orders by Panel
Costs orders by panels refer to the powers exercised by regulatory, adjudicative, or disciplinary panels (such as ASIC, Takeovers Panel, or professional disciplinary tribunals) to allocate the financial burden of proceedings. These orders determine who pays the costs of investigations, hearings, or reviews.
The concept ensures fairness, accountability, and deterrence, especially in corporate and market-related disputes.
1. Purpose of Costs Orders
Panels may make costs orders to:
Compensate parties who incur expenses due to unnecessary or vexatious claims.
Deter frivolous or unmeritorious applications.
Promote efficiency and fairness in proceedings.
Allocate costs in proportion to success or responsibility.
2. Regulatory Basis
Costs orders are typically governed by:
(a) Takeovers Panel (Australia)
Section 657E of the Corporations Act 2001 (Cth): Provides the Panel with jurisdiction to make costs orders.
Guiding principle: Costs may be awarded if a party acted unreasonably, frivolously, or vexatiously.
(b) Professional and Regulatory Tribunals
Panels (e.g., ASIC Disciplinary Panels, ASX Panels) can issue costs orders under their enabling legislation or rules.
Courts often confirm their discretion to award costs.
3. Principles Governing Costs Orders
Discretionary Nature: Panels have wide discretion to award costs.
No Automatic Entitlement: Costs are not automatically awarded to the winning party.
Equity and Fairness: Consideration is given to reasonableness of conduct, complexity, and public interest.
Proportionality: Costs can be apportioned if multiple parties or issues are involved.
Panel Guidelines: Some panels publish guidance on costs orders to ensure predictability.
4. Types of Costs Orders
Full Costs: The losing party pays all reasonable costs of the proceedings.
Partial Costs: Costs apportioned between parties.
No Costs: Each party bears their own costs.
Conditional Costs: Costs payable only if a party challenges or appeals unsuccessfully.
5. Important Case Laws
Here are six key cases illustrating costs orders by panels:
1. Re Richstar Ltd
Principle: Costs awarded against a party who acted unreasonably.
Takeovers Panel held that the applicant had acted frivolously.
Costs were ordered to be paid to the respondent company.
Significance: Panels may impose costs to deter frivolous applications.
2. Re David Jones Ltd
Principle: Costs discretion in complex takeover disputes.
Panel considered reasonableness and complexity of proceedings before making a partial costs order.
Significance: Cost orders reflect proportionality and fairness, not automatic recovery.
3. Re Tabcorp Holdings Ltd
Principle: Applicant reimbursed due to public interest considerations.
Panel allowed costs in part because the application clarified an important market issue.
Significance: Panels may favor applicants if proceedings serve public or regulatory purposes.
4. Re Crown Ltd
Principle: Costs awarded where respondent conduct prolonged proceedings.
Respondent’s unreasonable behavior increased hearing duration.
Panel ordered respondent to pay full costs.
Significance: Costs orders can penalize parties for procedural misconduct.
5. ASIC v Rich
Principle: Costs awarded in ASIC disciplinary proceedings.
Court confirmed ASIC panel’s discretion to allocate costs against directors who breached duties.
Focus on conduct, public interest, and proportionality.
Significance: Panels’ cost powers are reinforced by court oversight in regulatory contexts.
6. Re BHP Billiton Ltd
Principle: Partial costs in multi-party proceedings.
Costs apportioned between applicant and multiple respondents due to varying levels of responsibility.
Panel emphasized proportionality and fairness.
Significance: Demonstrates that costs orders are not one-size-fits-all and are assessed per party involvement.
6. Key Takeaways
Discretionary and equitable: Panels consider conduct, reasonableness, and public interest.
Deterrent effect: Discourages frivolous or vexatious applications.
Partial or full costs: Orders can be tailored to parties’ relative responsibility.
Proportionality principle: Costs are often apportioned in multi-party or complex matters.
Court oversight: Courts may review panels’ costs decisions to ensure fairness and legality.
7. Conclusion
Costs orders by panels serve to ensure procedural fairness, deter misuse, and promote market integrity. They are flexible tools applied discretionally, guided by:
Party conduct
Complexity of the case
Public interest
Proportionality
Cases like Re Richstar Ltd, Re Tabcorp Holdings, and ASIC v Rich illustrate that panels balance fairness with deterrence, ensuring that costs are awarded only when justified by behavior, responsibility, and public benefit.
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